I owned about 15 of those personally.. and self managed them from Oregon and they were in Mississippi ( I bought them gozone all brand new construction)  150 to 225k each.. over a 3 year period  now the Gozone bonus depreciation that saved me about 700k in income tax's has sunset and I can now sell them.. basically breaking even on them. and cash flow was neutral.. so I just have to take the 700k I would have paid uncle sam and figure out what my return was.. although that's way to much work for me....

A preforeclosure period of 120 days is required before a lender can enter foreclosure for lack of payment. 

I would love to keep it as a rental but at this time I think it would take too long for the rent values to increase enough to make sense Worst case scenario is I have to hold the home for an extended period if the market decreases short term. 

Stick to the numbers, period.

Have a long-term hold period(north of 10 years), enter when the market is telling you.

In high season, people generally stay for longer periods of time and things are humming a bit easier.

Meanwhile during the eviction period, we finalized our architectural plans and started the permitting process in the county so we didn't lose much time.

they probably have a bunch of 3% nonconforming loans on their balance sheet so 5.5% is not bad, totally reliable payments, plus in a legal battle they'd likely find the power of attorney didn't extend to the ridiculous term and that there was no breach of any enforceable agreement.   

However, I'm guessing the reason you're saying you need to wait 4 months is because of a required seasoning period?

(no waiting period to simply refi what is owed) DSCR programs are not purchased by Fannie/Freddie so they can set their own rules and some have a waiting period as short as 3 months.